ADJACENT MARKETS
• Corn and soybean meal futures fell as anticipated El Niño conditions alleviate some drought concerns across the United States. Also, Southern Hemisphere producers are posting record harvests, strengthening global supply.
• The CME Feeder Cattle Index rallied slightly higher on news of New World screwworm entering the United States.
• WTI Crude Oil prices remain elevated due to conflict in the Middle East, but following the reopening of the Strait of Hormuz, could face downward pressure as oil flows resume a more normal cadence.
JULY 2026 CBOT CORN FUTURES
CME FEEDER CATTLE INDEX
JULY 2026 CBOT SOYBEAN MEAL FUTURES
WEST TEXAS INTERMEDIATE CRUDE OIL SPOT PRICE
Sources: CBOT, CME, EIA
DAIRY MARGIN COVERAGE
The DMC Margin for April rose to $10.54/cwt as high Class IV values supported the All-Milk Price. Margins are anticipated to remain above the $9.50/cwt level through the rest of 2026, but may come under pressure in late summer with a lower forecasted All-Milk Price. With corn and soybean meal futures easing due to improved weather across the Midwest, feed prices are expected to remain moderate.
CONSUMER DEMAND INDICATORS
Economic pressures from conflict in the Middle East weighed on consumers in May as energy prices rose, pushing inflation to 4.2%. Consumer confidence now sits as low as it was during the peak 2022 inflationary period as rising inflation expectations and lagging wage growth (see Graph of the Month) weaken personal financial standing. The Restaurant Performance Index, which tracks restaurant growth/contraction, dipped to 99.8, indicating that some consumers are pulling back on discretionary spending. However, with the Strait of Hormuz looking to potentially resume normal operations, energy prices should ease in the coming months, though it will still take time before consumers see relief at the gas station or for the ripple effects of higher energy prices to subside.
LOOKING AHEAD
Milk production is expected to continue to grow modestly through the end of 2026 on account of strong beef returns even as producer margins for their milk are mixed. On the demand side, there are plenty of unknowns. U.S. exports have surged to start the year, particularly for cheese and butter, but the global dairy market is still fragile on account of growing milk supplies in Europe and Oceania. Domestically, high oil prices, rising inflation, and faltering consumer confidence would suggest that consumers may be looking for opportunities to cut spending in the near future, impacting food service traffic. The reopening of the Strait of Hormuz could also help the U.S. and global economies avoid the worst of the potential outcomes from the rise in oil prices.
Dairy Management Inc.™ and state, regional, and international organizations work together to drive demand for dairy products on behalf of America’s dairy farmers, through the programs of the American Dairy Association®, the National Dairy Council ® , and the U.S. Dairy Export Council ®
Katriel Marks-Yant, National Milk Producers Federation kmarksyant@nmpf.org www.nmpf.org
The National Milk Producers Federation (NMPF) develops and carries out policies that advance dairy producers and the cooperatives they own. NMPF’s member cooperatives produce more than two-thirds of U.S. milk, making NMPF dairy’s voice on Capitol Hill and with government agencies.
CHEESE — APRIL 2026
WHEY — APRIL 2026
BUTTER — APRIL 2026
NONFAT DRY MILK/SKIM MILK POWDER — APRIL 2026
